Assembly Bill 1118 proposes to convert the additional child and dependent care tax credit into a refundable tax credit starting with the 2026 tax year. This change allows claimants to receive a refund if their credit exceeds their tax liability, a significant shift from the current nonrefundable structure. The bill includes several amendments and new provisions, such as the creation of a new section (20.835 (2) (cd)) to allocate funds for these payments and the establishment of a new subsection (71.07 (9g) (b) 3.) that outlines the credit for taxable years beginning after December 31, 2025.

Key amendments in the bill include the renumbering of existing provisions and the addition of specific language to clarify the eligibility and calculation of the credit. For instance, the bill amends the existing credit provisions to reflect the new refundable nature and specifies that if the allowable claim exceeds the tax due, the excess will be certified for payment by the Department of Revenue. Additionally, the bill updates references to the additional child and dependent care tax credit in other sections of the statutes to ensure consistency with the new refundable structure.

Statutes affected:
Bill Text: 71.07(9g)(b)2, 71.07, 71.10(4)(cs), 71.10